ECO 201 Study Guide - Midterm Guide: Average Variable Cost, Fixed Cost, Perfect Competition

What distinguishes the short run from the long run?

A)In the short run, all inputs are variable, and in the long run, all inputs are variable.

B)In the short run, some inputs are fixed, and in the long run, some inputs are fixed.

C)In the short run, some inputs are fixed, while in the long run, all inputs are variable.

D)In the short run, all inputs are variable, while in the long run, some inputs are fixed.

The distinction between the short-run and the long-run for a perfectly competitive firm or a monopolist is that:

24. To economists, the main difference between the short run and the long run is that a. the law of decreasing marginal returns applics in the long run but not in the short run. b. in the short run, all inputs are fixed while in the long run all inputs are variable. c. fixed costs are more important to decision making in the long run than they are in the short run. d. in the long run all inputs are variable while in the short run at least one input is fixed. e. a and d.